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Home > Media Reviews > News Review Last Updated: 14:03 05/17/2007
News Review #395: May 17, 2007

Japan the World's Most Innovative Country

Reviewed by Takahiro MIYAO

Japan the World's Most Innovative Country - Economist Intelligence Unit
Forbes (5/16/2007)

Japan Rated Tops for Innovation
The Japan Times (5/17/2007)
China Overtakes Japan in Intl Competitiveness
Daily Yomiuri (5/11/2007)


It is somewhat surprising to see a headline like "Japan the World's Most Innovative Country" in the Western media, as Japan appears to be overtaken by China and other rapidly developing economies in many respects these days. In fact, just a few days ago we read an article entitled "China Overtakes Japan in Intl Competitiveness" in The Daily Yomiuri, reporting the well known IMD World Competitiveness Ranking, where Japan fell from 16th to 24th, whereas China moved up from 18th to 15th in terms of international competitiveness for last year.

It is stated in this Forbes article that "with annual expenditure of 136 billion US dollars on R&D, China now outspends Japan," but no explanation is given as to why Japan is ranked so high in spite of that fact, except by mentioning that "there is a small country advantage" in the current study by the Economist Intelligence Unit (EIU). In this regard, it is reported in the Japan Times article listed above that the EIU study uses various measures of innovation in per capita terms, such as the number of patents per million people, so Japan enjoys a definite advantage compared to more populous countries such as China and the U.S.

Actually, the Japan Times article also reports an important result in the EIU study that only 2 percent of global company executives saw Japan as having the best conditions for innovation, whereas 40 percent of them regarded the U.S. and 12 percent picked India as the most conducive place to innovate." All this means that ranking countries is a tricky business, and we should not take it too seriously. We are living in a rapidly globalizing world and, therefore, it is becoming less meaningful to talk about ranking among countries, certainly less so than ranking among cities and regions or among business corporations.

This review is adopted from the following blog (with its Japanese translation):

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